The Triforce of Debt: Are We Really Doomed?

Hyrule's Fiscal Forecast: Gloom or Great?

Greetings citizens of Hyrule! Or as you might call it America. Princess Zelda here reporting live from… well my castle (it's a long story). Apparently there's some hubbub about this 'budget deficit' thingy. Steve Eisman a wise man who unlike Ganondorf correctly predicted disaster once says we might be overreacting to the size of it.

Trump's One Big Beautiful… Bill?

So this 'One Big Beautiful Bill' signed by President Trump? Seems it's got investors more jittery than a Cucco in a thunderstorm. It's packed with tax cuts increased spending for immigration enforcement and (gasp!) cuts to Medicaid. The Congressional Budget Office says it could add a whopping $3.4 trillion to our existing $36.2 trillion debt! That's enough rupees to buy every shop in Hyrule... several times over.

Treasury Yields: The Silent Princess?

Eisman isn't as worried as a Lynel on a rampage. He's looking at the 10 year Treasury yield. Normally that should be screaming like a Stalchild at midnight if the country's fiscal health is truly awful. But… it's been pretty quiet since December 2022. "If there was a real alternative to Treasury then all of this stuff about the deficit is something that I would pay attention to. But as long as there's no alternative there's nothing to talk about," Eisman said. Basically if everyone's still betting on Treasury why panic?

Bond Yields: Rising Like the Blood Moon?

But hold on! Investors fear this tax and spending bill could push bond yields up. If the U.S. government issues more debt the increased supply could drop prices and raise yields. It's like when I try to cook: too many ingredients and suddenly everything is on fire!

The Internet Bubble: A Cautionary Tale for Our Time

Eisman isn't too concerned about high stock valuations either. He points out that the internet bubble burst because of a recession not just because stocks were overpriced. "What broke the internet bubble was not valuation. What broke the internet bubble was a recession that caused some of these companies to go bankrupt and to do badly," Eisman said "So until there's something really bad happening like a trade war which is still a possibility the valuation is not something I really pay that much attention [to]." So basically we need to worry about a trade war more than inflated stock prices. Sounds about right.

A Princess's Conclusion: Keep Your Eyes Open!

So what's the takeaway dear readers? The budget deficit might not be as scary as Ganondorf just yet. But like Link facing a horde of Moblins we need to stay vigilant. A trade war or some other disaster could change everything. Until then maybe we can all just relax and enjoy some Lon Lon Milk. After all "It's something everyone can enjoy!"